Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Basic Finance Expert

1) North Bank awards thirty-year mortgages for the total amount of $100 million. These mortgages need payments of coupons of 10% at quarterly basis. Reply the following problems:

a) What is the quarterly mortgage payment?

b) Create the amortization schedule over 1st year of life of mortgage to find out how much of each payment goes to principle and how much to interest Consider now 30-year Collateralized Mortgage Obligations (CMOs) by using this mortgage pool as collateral. There are 3 tranches with following characteristics:

Class A: Quarterly fixed coupon 9%, class size $20 million.
Class B: Quarterly fixed coupon 10%, class size $30 million.
Class C: Quarterly fixed coupon 11%, class size $50 million

c) Suppose that there are not at any time any type of repayments (e.g. premature payments of the mortgages), what are total promised coupon payments to three classes? prepare down the principal payments to each of three classes for the 1st year?

d) If, over first year, there are quarterly repayments of $5 million on mortgage pool, how are the funds distributed?

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M915149

Have any Question? 


Related Questions in Basic Finance

Firm x has a proposed project that will generate sales of

Firm X has a proposed project that will generate sales of 2,750 units at a selling price of $36 each. The fixed costs are $18,000 and the variable costs per unit are $21. The project requires $36,000 of fixed assets that ...

A random sample of 138 observations produced a sample mean

A random sample of 138 observations produced a sample mean of 30. Find the critical and observed values of z for the following test of hypothesis using α=0.1. The population standard deviation is known to be 9 and the po ...

Terry malloy is trying to decide whether his shipping

Terry Malloy is trying to decide whether his shipping company should invest in a new boat.  The new boat will cost $200,000 and it will be fully-depreciated on a straight-line basis over its 10-year useful life.  The new ...

1 should demand characteristics be eliminated or

1. Should demand characteristics be eliminated or strengthened in an experiment? Explain. 2. How do researchers detect and eliminate placebo effects? 3. What effect does error variance have on the results of an experimen ...

Classify all of your spending into categories such as car

Classify all of your spending into categories such as car, rent, school expenses, clothing, and entertainment. Determine the proportion of your cash outflows that are allocated toward each of these categories. Describe t ...

Explain how closeout netting reduces the credit risk for

Explain how closeout netting reduces the credit risk for two firms engaged in several derivatives contracts ? How does the legal system impose risk on a derivatives dealer? Consider a firm that has assets that generate c ...

Distinguish between high- and low-quality internet

Distinguish between high- and low-quality Internet sources. Imagine that a person you admire is coming to speak on campus. You have been selected to introduce the speaker to your entire graduating class. Of course you wa ...

Final project - fire 650refer to the template spreadsheet

Final Project - FIRE 650 Refer to the template spreadsheet provided.  Stock A has an annualized volatility equal to 18% for which you have just written an out-of-the-money 26 week call option.  The risk free rate is 2% p ...

1 compare and contrast economic market and relevancy value2

1. Compare and contrast economic, market, and relevancy value. 2. Illustrate the differences in product/service creation, presentation, and positioning. 3. Explain the folIowing statement: "The methodology is systems ana ...

In early 2009 an article in the new york times

In early 2009, an article in the New York Times observed: "Without a cure for the problem of bad assets, the credit crisis that is dragging down the economy will linger, as banks cannot resume the ample lending needed to ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

WalMart Identification of theory and critical discussion

Drawing on the prescribed text and/or relevant academic literature, produce a paper which discusses the nature of group

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro